Understanding Energy Security in Geopolitical Contexts: Insights from Decomposing Energy Diversification Indexes
Haithem Awijen  1@  , Thuy Dao  2@  , Rizwan Ahmed  3@  
1 : INSSEC Business School
OMNES RESEARCH CENTER
2 : IPAG Business School
IPAG Busness School
3 : Kent Business School, University of Kent

This study examines the impact of geopolitical events on energy security by analyzing the decomposed
components of the Adjusted Herfindahl-Hirschman Index (HHI) and the Country Diversification Index (CDI).
Utilizing data from significant geopolitical events, including the Iraq War, Annexation of Crimea, and the
2014 Oil Price Collapse, we employ Pooled Ordinary Least Squares (OLS), Feasible Generalized Least Squares
(FGLS), and Multilevel Regression models to evaluate the effects of technological innovation, geopolitical risk,
political stability, and various economic factors on energy security. Our findings reveal that technological
innovation, as measured by patent grants, significantly influences the diversification and covariance components
of energy security, while its effect on risk is more variable across events. Additionally, geopolitical risk, although
consistently present, does not directly impact energy security components in a statistically significant way.
Political and economic variables such as the level of democracy, political corruption, trade openness, GDP
per capita, and population density also play critical roles, varying in significance across different geopolitical
contexts. This research highlights the complexity of energy security dynamics and underscores the importance
of considering multiple factors in policy development and strategic planning.


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